Forensic Accounting

Stamatis Dritsas, CRP, AAIA, CPA (GR)

 Forensic Accounting

 What is Forensic Accounting ?

 Forensic Accounting vs Traditional
Accounting and Auditing
 What does a Forensic Accountant do ?
 Types of assignments
 Who retains a Forensic Accountant ?

Stamatis Dritsas, CRP, AAIA, CPA (GR)

 Forensic Accounting, the term
 “The integration of accounting, auditing and
investigative skills yields a specialty known as Forensic
Accounting” (Alan Zysman).

 Forensic Accounting is the application of accounting

principles, theories and discipline to fact or hypotheses
at issues in a legal dispute and encompasses every
branch of accounting knowledge (AICPA).

 “Belonging to, used in or suitable to courts of judicature

or to public discussion and debate” (Webster’s
Dictionary).

Stamatis Dritsas, CRP, AAIA, CPA (GR)

 Forensic Accounting, the scope

 “Forensic Accounting provides an accounting analysis

that is suitable to the court which will form the basis for
discussion, debate and ultimately dispute resolution”
(Alan Zysman).

Stamatis Dritsas, CRP, AAIA, CPA (GR)

 Forensic Accounting vs Traditional
Accounting and Auditing
 Forensic Accounting vs Traditional Accounting:

 Does not produce financial or other type of managerial

information

 Consists a basis of discussion suitable to courts or public

discussion or debate

 Does not support decision making for management

purposes, always strictly related to actual or suspected
fraud

Stamatis Dritsas, CRP, AAIA, CPA (GR)

 Forensic Accounting vs Traditional
Accounting and Auditing
 Forensic Accounting vs Traditional Auditing:

 It is not an assurance engagement

 The scope is not an error identification or prevention

 Provides conclusions on a subject matter, which is

always related to fraud

 The use of materiality may not be appropriate

Stamatis Dritsas, CRP, AAIA, CPA (GR)

 Forensic Accounting vs Traditional
Accounting and Auditing
 Forensic Accounting vs Traditional Auditing:

 The quality of documentation could tend to be conclusive rather

than persuasive (e.g. interviews are very close to testimonies)

 Evidence gathering procedures and audit tests

 The application of sampling may be inappropriate

Stamatis Dritsas, CRP, AAIA, CPA (GR)

 Forensic Accounting vs Traditional
Accounting and Auditing
 Forensic Accounting vs Traditional Auditing:

 The type of the report is not standardized and always tailored to

subject matter and the type of fraud

 Forensic Accountants do not apply professional standards on

auditing

Stamatis Dritsas, CRP, AAIA, CPA (GR)

 What is Forensic Accounting
 Other alternative designations:

 Forensic Accountancy or
 Investigative Accounting
 Fraud Auditing
 Fraud Investigation
 Litigation Support

 Forensic Accountancy: The specialty practice area of

accountancy that describes engagements that result
from actual or anticipated disputes or litigation.

Stamatis Dritsas, CRP, AAIA, CPA (GR)

 What is Forensic Accounting
 In Greek:

 Δικανική Λογιστική ή

 Εγκληματολογική Λογιστική

Stamatis Dritsas, CRP, AAIA, CPA (GR)

 What is Forensic Accounting
 Forensic Accounting encompasses both:

 Litigation Support

 Investigative Accounting

(Alan Zysman)

Stamatis Dritsas, CRP, AAIA, CPA (GR)

 What is Forensic Accounting
 Litigation Support:

 Provides assistance of an accounting nature in

a matter involving existing or pending litigation.
 It deals primarily with issues related to the
quantification of economic damages.

A typical litigation support assignment would be

calculating the economic loss resulting from breach a
contract (Alan Zysman).

Stamatis Dritsas, CRP, AAIA, CPA (GR)

 What is Forensic Accounting
 Investigative Accounting:

 Is often associated with investigations of

criminal matters.

A typical investigative accounting would be an

investigation of employee theft (Alan Zysman).

Stamatis Dritsas, CRP, AAIA, CPA (GR)

 What does a Forensic Accountant do
 A Forensic Accountant is often retained to
analyze, interpret, summarize and present
complex financial and business related issues
in a manner which is both understandable and
properly supported (Alan Zysman).

Stamatis Dritsas, CRP, AAIA, CPA (GR)

 Types of assignments

 Criminal Investigations
 Economic damages calculations
 Shareholder’s and Partnership Disputes
 Post acquisition disputes
 Business / Employee Fraud Investigations
 Bankruptcy, insolvency and reorganization
 Business Valuation
 Computer forensics

Stamatis Dritsas, CRP, AAIA, CPA (GR)

 Who retains a Forensic Accountant

 Lawyers
 Police Forces
 Insurance Companies
 Government Regulatory Bodies and Agencies
 Banks
 Courts
 Business Community

Stamatis Dritsas, CRP, AAIA, CPA (GR)

 Thank you for your attention

Stamatis Dritsas, CRP, AAIA, CPA (GR)